Portugal

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indicator

value

unit

Population

10.7

mil.

Visitors per year

7.7

mil.

Renewable energy

21.2

%

How’s Life?

Portugal performs well in only few measures of well-being relative to most other countries in the Better Life Index. Portugal ranks above the average in housing, but below average in income and wealth, health status, social connections, civic engagement, education and skills, subjective well-being, and jobs and earnings.

Money, while it cannot buy happiness, is an important means to achieving higher living standards. In Portugal, the average household net-adjusted disposable income per capita is USD 20 086 a year, less than the OECD average of USD 25 908 a year. But there is a considerable gap between the richest and poorest – the top 20% of the population earn nearly six times as much as the bottom 20%.

In terms of employment, around 61% of people aged 15 to 64 in Portugal have a paid job, lower than the OECD employment average of 65%. Some 63% of men are in paid work, compared with 58% of women. In Portugal, around 10% of employees work very long hours, less than the OECD average of 13%, with 13% of men working very long hours compared with just 6% for women.

Good education and skills are important requisites for finding a job. In Portugal, 38% of adults aged 25-64 have completed upper secondary education, much lower than the OECD average of 75% and one of the lowest rates among OECD countries. This is truer of women than men, as 34% of men have successfully completed high-school compared with 41% of women. In terms of the quality of the educational system, the average student scored 488 in reading literacy, maths and science in the OECD’s Programme for International Student Assessment (PISA). This score is slightly lower than the OECD average of 497. On average in Portugal, girls outperformed boys by 10 points, more than the average OECD gap of 8 points.

In terms of health, life expectancy at birth in Portugal is almost 81 years, one year above the OECD average. Life expectancy for women is 84 years, compared with 77 for men. The level of atmospheric PM10 – tiny air pollutant particles small enough to enter and cause damage to the lungs – is 18.1 micrograms per cubic meterin large urban areas, lower than the OECD average of 20.1 micrograms per cubic meter. Portugal does well in terms of water quality, as 86% of people say they are satisfied with the quality of their water, above the OECD average of 81%.

Concerning the public sphere, there is a moderate sense of community and level of civic participation in Portugal, where 86% of people believe that they know someone they could rely on in time of need, less than the OECD average of 88%. Voter turnout, a measure of citizens’ participation in the political process, was 58% during recent elections; lower than the OECD average of 68%. Social and economic status can affect voting rates; voter turnout for the top 20% of the population is an estimated 63% and for the bottom 20% it is an estimated 56%. This difference is lower than the OECD average difference of 13 percentage points.

In general, the Portuguese are less satisfied with their lives than the OECD average. When asked to rate their general satisfaction with life on a scale from 0 to 10, Portuguese people gave it a 5.1 grade, one of the lowest scores in the OECD, where average life satisfaction is 6.6.

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Portugal in Detail

Key Findings

Living in satisfactory housing conditions is one of the most important aspects of people’s lives. Housing is essential to meet basic needs, such as shelter, but it is not just a question of four walls and a roof. Housing should offer a place to sleep and rest where people feel safe and have privacy and personal space; somewhere they can raise a family. All of these elements help make a house a home. And of course there is the question whether people can afford adequate housing.

Housing costs take up a large share of the household budget and represent the largest single expenditure for many individuals and families, by the time you add up elements such as rent, gas, electricity, water, furniture or repairs. In Portugal, households on average spend 19%of theirgross adjusted disposable income on keeping a roof over their heads, slightly above the OECD average of 18%.

In addition to housing costs it is also important to examine living conditions, such as the average number of rooms shared per person and whether households have access to basic facilities. The number of rooms in a dwelling, divided by the number of persons living there, indicates whether residents are living in crowded conditions. Overcrowded housing may have a negative impact on physical and mental health, relations with others and children’s development. In addition, dense living conditions are often a sign of inadequate water and sewage supply. In Portugal, the average home contains 1.6 rooms per person, slightly less than the OECD average of 1.8 rooms per person. In terms of basic facilities, 99.1%of people in Portugal live in dwellings with private access to an indoor flushing toilet, more than the OECD average of 97.6%.

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Indicators

Key Findings

While money may not buy happiness, it is an important means to achieving higher living standards and thus greater well-being. Higher economic wealth may also improve access to quality education, health care and housing.

Household net-adjusted disposable income is the amount of money that a household earns each year after taxes and transfers. It represents the money available to a household for spending on goods or services. In Portugal, the average household net-adjusted disposable income per capita is USD 20 086 a year, lower than the OECD average of USD 25 908.

Household financial wealth is the total value of a household’s financial worth, such as money or shares held in bank accounts. In Portugal, the average household net financial wealth per capita is estimated at USD 31 245, lower than the OECD average of USD 67 139. While the ideal measure of household wealth should also include non-financial assets (e.g. land and dwellings), such information is currently available for only a small number of OECD countries, and is not included here.

Despite a general increase in living standards across OECD countries over the past fifteen years, not all people have benefited from this to the same extent. In Portugal, the average net-adjusted disposable income of the top 20% of the population is an estimated USD 41 983 a year, whereas the bottom 20% live on an estimated USD 7 254 a year.

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Indicators

Key Findings

Having a job brings many important benefits, including: providing a source of income, improving social inclusion, fulfilling one’s own aspirations, building self-esteem and developing skills and competencies. In Portugal, around 61% of the working-age population aged 15 to 64 has a paid job. This figure is lower than the OECD average of 65%. Employment rates are generally higher for individuals with a higher level of education; in Portugal, an estimated 77% of individuals with at least a tertiary education have a paid job, compared with anestimated55% for those without an upper secondary education. This 22 percentage point difference is lower than the OECD average of 34 percentage points.

Women are still less likely than men to participate in the labour market. In Portugal, 58% of women have jobs. This is in line with the OECD average, but below the 63% employment rate of men in Portugal. This 5 percentage point gender difference is much lower than the OECD average of 15 percentage points and suggests Portugal has been successful in addressing the constraints and barriers women face in accessing work.

Unemployed persons are defined as those who are not currently working but are willing to do so and actively searching for work. Long-term unemployment can have a large negative effect on feelings of well-being and self-worth and result in a loss of skills, further reducing employability. In Portugal, the percentage of the labour force that has been unemployed for a year or longer is currently at 9.1%, much higher than the OECD average of 2.8%. There is little difference on average between men and women in the OECD area when it comes to long-term unemployment. In Portugal, the long-term unemployment rate for men is slightly higher than for women, with respectively 9.2% and 9.0%.

The wages and other monetary benefits that come with employment are an important aspect of job quality. Portuguese people earn USD 23 688 per year on average, less than the OECD average of USD 36 118 Not everyone earns that amount however. In all OECD countries, men still earn more than women, with an average wage gap of 15.5%. In Portugal, men earn 16.3% more than women. Also, whereas the top 20% of the population earn an estimated USD 31 448 per year, the bottom 20% live on an estimated USD 11 886 per year.

Another essential factor of employment quality is job security. Workers facing a high risk of job loss are more vulnerable, especially in countries with smaller social safety nets. In Portugal, workers face an 8.6% chance of losing their job, higher than the OECD average of 5.4%.

Better Policies for Better Lives

Jobs for innovation and productivity

The Portuguese economy contracted in 2011-13 in the wake of the global financial crisis. However, GDP is forecast to grow in real terms in 2014. The government has taken significant action to restore the sustainability of public finances and restart growth. On-going reforms aim to improve product and labour market regulation, upgrade education and skills, and enhance innovation.

Innovation also has a major role to play in boosting productivity. Portugal’s business environment is very conducive to entrepreneurship, although provision of venture capital is at the median of OECD countries. Various initiatives support business innovation, entrepreneurship and SMEs. The Financial Support to Company Growth (FINCRESCE) programme aims to improve financing conditions for firms with good innovative capabilities and risk profiles. The Strategic Initiative for Entrepreneurship and Innovation, approved in 2011, focuses on strengthening knowledge and capacities, reinforcing innovation and entrepreneurship, and promoting innovation financing. SIFIDE provides fixed and incremental tax credits for R&D and supports the hiring of doctoral-level graduates in companies. In 2013, the government launched INOVA, Creative Youngsters: Entrepreneurs for the 21st century programme to develop an environment that favours innovation and creativity in primary and secondary schools. The programme seeks to foster youngsters’ analytical capabilities and the mind-sets needed to identify business opportunities, take risks and face competition.

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Key Findings

Humans are social creatures. The frequency of our contact with others and the quality of our personal relationships are thus crucial determinants of our well-being.

A strong social network, or community, can provide emotional support during both good and bad times as well as provide access to jobs, services and other material opportunities. In Portugal, 86% of people believe that they know someone they could rely on in time of need, less than the OECD average of 88%. There is a 5 percentage point difference between men and women, as 88% of men believe they have this kind of social support, compared with 83% of women. There is also a clear relationship between the availability of social support on the one hand, and people’s education level on the other.. In Portugal, only 80% of people who have completed primary education report having someone to count on for help in times of need, compared to 95% for people who attained tertiary education.

A weak social network can result in limited economic opportunities, a lack of contact with others, and eventually, feelings of isolation. Socially isolated individuals face difficulties integrating into society as a contributing member and fulfilling personal aspirations.

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Key Findings

A well-educated and well-trained population is essential for a country’s social and economic well-being. Education plays a key role in providing individuals with the knowledge, skills and competences needed to participate effectively in society and in the economy. Having a good education greatly improves the likelihood of finding a job and earning enough money. The Portuguese can expect to go through 17.6 years of education between the ages of 5 and 39, slightly less than the OECD average of 17.7 years.

Graduating from upper secondary education has become increasingly important in all countries, as the skills needed in the labour market are becoming more knowledge-based. High-school graduation rates therefore provide a good indication of whether a country is preparing its students to meet the minimum requirements of the job market. In Portugal, 38% of adults aged 25-64 have completed upper secondary education, much lower than the OECD average of 75% and one of the lowest rates among OECD countries. Across the OECD, slightly more men aged 25-64 have the equivalent of a high-school degree compared with women from the same age group.In Portugal however, the opposite is true as 34% of men have successfully completed high-school compared with 41% of women. This is also true at the university level, asmore women complete tertiary education than men in Portugal, at 23% and 15% respectively. This 8 percentage point gap is larger than the OECD average of 4 percentage points.

But graduation rates, while important, speak little to the quality of education received. The OECD’s Programme for International Student Assessment (PISA) reviews the extent to which students have acquired some of the knowledge and skills that are essential for full participation in modern societies. In 2012, PISA focused on examining students’ reading ability, skills in maths and level in sciences, as research shows that these skills are more reliable predictors of economic and social well-being than the number of years spent in school.

The average student in Portugal scored 488 in reading literacy, maths and sciences, lower than the OECD average of 497. On average, girls outperformed boys by 10 points, higher than the average OECD gap of 8 points.

The best-performing school systems manage to provide high-quality education to all students. In Portugal, the average difference in results, between the students with the highest socio-economic background and the students with the lowest socio-economic background is 113 points, higher than the OECD average of 96 points. This suggests the school system in Portugal does not provide equal access to high-quality education.

Better Policies for Better Lives

Student learning outcomes in Portugal are around or slightly below the OECD average, depending on the skills assessed, and have shown some encouraging improvement in the last decade. However the high share of students leaving the education system too early with low skills remains a major problem. Portugal has introduced a number of measures to increase secondary and tertiary education attainment and improve quality in education. The Education Programme 2015, for instance, establishes targets for school education focusing on two main priority areas: improving the basic competencies of students, and ensuring that all young people remain in the education system. The programme sets targets for reducing the early school leaving rate for 14-16 year-olds, and reducing the number of students who repeat grades, with indicators to monitor progress. These targets are linked to wider European Union benchmarks for 2020.

There have also been a number of recent initiatives to use schools to provide a second opportunity to people who have left school early or are at risk of doing so, or adults who may not have completed compulsory education. Under the New Opportunities scheme these programmes are offered on school premises and using the school’s teachers.

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Indicators

The quality of our local living environment has a direct impact on our health and well-being. Outdoor air pollution is one important environmental issue that directly affects the quality of people’s lives. Despite national and international interventions and decreases in major pollutant emissions, the health impacts of urban air pollution continue to worsen, with air pollution set to become the top environmental cause of premature mortality globally by 2050. Air pollution in urban centres, often caused by transport and the use of small-scale burning of wood or coal, is linked to a range of health problems, from minor eye irritation to upper respiratory symptoms in the short-term and chronic respiratory diseases such as asthma, cardiovascular diseases and lung cancer in the long-term. Children and the elderly may be particularly vulnerable.

PM10 – tiny particulate matter small enough to be inhaled into the deepest part of the lung – is monitored in OECD countries because it can harm human health and reduce life expectancy. In Portugal, PM10 levels in urban areas are 18.1 micrograms per cubic meter, below the OECD average of 20.1 micrograms per cubic meter and the annual guideline limit of 20 micrograms per cubic meter set by the World Health Organization.

Access to clean water is fundamental to human well-being. Despite significant progress in OECD countries in reducing water pollution, improvements in freshwater quality are not always easy to discern. In Portugal, 86% of people say they are satisfied with water quality, higher than the OECD average of 81%.

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Key Findings

Trust in government is essential for social cohesion and well-being. High voter turnout is a measure of citizens’ participation in the political process. In the most recent elections for which data are available, voter turnout in Portugal was 58% of those registered. This figure is lower than the OECD average of 68%.

Even if the right to vote is universal in all OECD countries, not everyone exercises this right. There is little difference in the voting rates of men and women in most OECD countries. This is the case in Portugal, where the voter turnout of men and women is nearly the same. While on average there are few differences between men and women concerning participation in elections, income can make a big difference in voter turnout. In Portugal, voter turnout for the top 20% of the population is an estimated 63% whereas the participation rate of the bottom 20% is an estimated 56%. This 7 percentage point difference is lower than the OECD average difference of 13 percentage points.

In general, women are in the minority among elected representatives and although their number has slightly increased in the last decade, it is still well below parity. In Portugal, 31% of the seats in national parliament are held by women, more than the OECD average of 28%.

Ensuring that government decision making is not compromised by conflicts of interest is key to maintaining trust in government. Transparency is therefore essential to hold government to account and to maintain confidence in public institutions.

Freedom of information laws (FOI) allow the possibility for individuals to access undisclosed information. For such policies to be successful, the public should have a clear understanding of their rights under the law, should be able to file requests with ease and should be protected against any possible retaliation. People in Portugal can file a request for information either in writing, online, or in person – thus greatly facilitating the FOI process. However, there are no provisions for anonymity or protection from retaliation.

Better Policies for Better Lives

Citizen shops for better services

Portugal has built a network of local “citizen shops” which offer public and private services. These range from public social security and tax services to private services such as arranging the connecting and disconnecting of electricity, water and gas or cable television subscriptions. In one single place, citizens have access to a wide range of services with longer opening hours and can save considerable amounts of time.

Some second generation citizen shops offer counters organised around common life events, such as the “I lost my wallet” service, “having a child” service or housing-related services as well as multi-service counters.

The citizen shops cover the whole country with shops in most district capitals, and have greatly improved the efficiency and quality of services provided to citizens.

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Indicators

Most OECD countries have enjoyed large gains in life expectancy over the past decades, thanks to improvements in living conditions, public health interventions and progress in medical care. Lifeexpectancy at birth in Portugal stands at almost 81 years, one year above the OECD average of 80 years. Life expectancy for women is 84 years compared with 77 for men, a wider difference than the average OECD gender gap of five years, with a life expectancy of 82 years for women and 77 for men.. Higher life expectancy is generally associated with higher health care spending per person, although many other factors have an impact on life expectancy (such as living standards, lifestyles, education and environmental factors). When asked “How is your health in general?” only 46% of people in Portugal reported to be in good health, much less than the OECD average of 68% and one of the lowest scores across the OECD. Despite the subjective nature of this question, answers have been found to be a good predictor of people’s future health care use. Gender, age and social status may affect answers to this question. On average in OECD countries, men are more likely to report good health than women, with an average of 70% for men and 66% for women. In Portugal, the average is 51% for men and 41% for women. Not surprisingly, older people report poorer health, as do those who are unemployed, or who have less education or income. About 62% of adults with a disposable income in the top 20% in Portugal rated their health as “good” or “very good”, compared to about 40% for those with a disposable income in the bottom 20%.

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Indicators

Key Findings

Happiness or subjective well-being can be measured in terms of life satisfaction, the presence of positive experiences and feelings, and the absence of negative experiences and feelings. Such measures, while subjective, are a useful complement to objective data to compare the quality of life across countries.

Life satisfaction measures how people evaluate their life as a whole rather than their current feelings. When asked to rate their general satisfaction with life on a scale from 0 to 10, Portuguese people gave it a 5.1 grade, one of the lowest scores in the OECD, where average life satisfaction is 6.6.

There is little difference in life satisfaction levels between men and women across OECD countries. This is true in Portugal, where both men and women gave their life a 5.1 grade. When considering people’s education level, however, there is a clear difference in life satisfaction levels in many OECD countries. Whereas people who have only completed primary education in Portugal have a life satisfaction level of 4.5, this score reaches 6.2 for people with tertiary education.

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Indicators

Key Findings

Personal security is a core element for the well-being of individuals, and includes the risks of people being physically assaulted or falling victim to other types of crime. Across the OECD, assault rates have generally declined in the past five years. In Portugal, 5.7% of people reported falling victim to assault over the previous 12 months, more than the OECD average of 3.9%. There is little difference between men and women in assault rates, at respectively 5.2% and 6.1%.

The homicide rate (the number of murders per 100 000 inhabitants) is a more reliable measure of a country’s safety level because, unlike other crimes, murders are usually always reported to the police. According to the latest OECD data, Portugal’s homicide rate is 1.1, lower than the OECD average of 4.0. In Portugal, the homicide rate for men is 1.5 compared with 0.7 for women.

However, while men are at a greater risk of being victims of assault and violent crime, women report lower feelings of security than men. This has been explained by a greater fear of sexual attacks, the feeling they must also protect their children and their concern that they may be seen as partially responsible.

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Key Findings

Finding a suitable balance between work and life is a challenge for all workers, especially working parents. The ability to successfully combine work, family commitments and personal life is important for the well-being of all members in a household. Governments can help to address the issue by encouraging supportive and flexible working practices, making it easier for parents to strike a better balance between work and home life.

An important aspect of work-life balance is the amount of time a person spends at work. Evidence suggests that long work hours may impair personal health, jeopardise safety and increase stress. The share of employees working 50 hours or more per week is not very large across OECD countries. In Portugal, about 10% of employees work very long hours, less than the OECD average of 13%. Overall, more men work very long hours; in Portugal 13% ofmen work very long hours, compared with 6% for women.

Better Policies for Better Lives

Portuguese families need further childcare support

For over a generation of families, fertility rates in Portugal have been falling. , Portugal‘s fertility rate, at 1.28, is the lowest in the OECD, which has important implications for the changing face of future Portuguese society. In fact, the problem is not that families have no children, but rather that Portuguese families often do not have more than one child. Childlessness is low in Portugal, less than one in ten women aged 49+ have no children, but around half of all Portuguese families are one-child families. To improve fertility rates, Portuguese families need more support when caring for young children.

Recent parental leave reform has helped both mothers and fathers to spend more time with their new-borns, as well as promoting gender equity through financial incentives to share parental leave. Childcare enrolment of children not yet 3 years of age in Portugal has increased sharply over the last decade to 45.9% (the OECD average is 32.6%).

Portugal should try to invest more of their public family budget towards early support for children, even in times when budget pressures are at their highest. Investment on child services is essential to enable families to flourish, for future welfare state sustainability and for economic growth. Portugal is already spending less than the OECD average at each stage of childhood. Reported spending on children in their early years is less than half of the OECD average (EUR 16 240 per child compared to EUR30 950) and mid- and late- childhood spending lag behind OECD levels by around one-third and one-fifth respectively.